Days like these make you think a lot about how adaptable humans can be. You can keep us at home and restrict our movements, but some way or another, we will find the means to make do with what we have and some times even improvise - like I've come to learn that you don't need to go to Yoshinoya for a beef bowl, you can easily make one at home with a gyudon packet from Donki.
And instead of my usual cup of magic, my mornings are spent by the window with a butter cookies dipped with a strong dose of Nespresso.
Surely productivity across companies must have gone down during the last two months. Not solely because people are confined to working from their homes and are distracted by other chores, but largely because most of everywhere else in the world has basically come to a standstill. It's hard to say which is which but I think one drives the other.
Where do we go from here? I don't think we will stay this way for long. Peer-to-peer interaction is still very much the core of civilisation. I was watching a property webinar today on how the real estate market has basically weathered every known recession since 2000. One of the anecdotes that was shared was:
Do car accidents deter people from driving on roads forever? No. People don't stop driving just because of one or a few accidents. Humans are adaptable. We invent traffic lights, implement anti-lock braking systems, we impose harsher penalties on errant traffic offenders and we educate the general public on road safety - but we certainly won't ban people from driving.
If life throws us a curve ball, we adapt. If the virus takes away in-person meetings, we use Zoom. So we can't eat outdoors, we just call for food deliveries. Businesses will find a way to re-purpose themselves e.g. makers of luxury goods will make masks; airlines will continue to operate by transporting cargo and private car drivers will do step up to fill any additional demand for food deliveries during this period. Doctors around the world continue to test and treat patients everyday.
So maybe the optimism in markets these days isn't so much about whether stocks have 'bottomed out' or if scientists around the world are on track to find a cure for the virus. There is just too much we can learn about these pathogens. They evolve and even if we suppress them today, who knows what lies in store for the next few decades.
But for now, the world looks hinged on the confidence of our survivability. Such is the adaptability of human beings. And in days like these where people are dying by the thousands everyday from the virus, rather than be a sourpuss, sometimes all we need is just a little optimism.
Day 4 of Singapore's so -coined "circuit breaker". This is how my re-designed work space looks like.
My daily routine has totally been disrupted. I used to frequent the cafe that's near my place around 8-9am in the morning. I would sit there to start the day reading news, emails and top stories from the night before. Depending on the morning schedule, I could sit there for hours right up till lunch. These days I spend the entire mornings at home.
I think this is a very trying period for many people. These are very uncertain times. Sure, I've been through economic uncertainties - the global financial crisis in 2008 which saw 100+ years-old Lehman vanish, the Eurozone crisis in 2011 and the oil supply glut in 2015. These crises were mainly driven by financial markets. People were nervous, some lost jobs and there was a lot of jitters in the office at times. So back then as an employee, I just sat tight, kept my head down and did my work. It was tough and everyone knew bonuses would be bad, salary increments would be crimped. But this time it was different for me.
This is possibly the very first time I am experiencing a worldwide financial crisis and pandemic as an employer / entrepreneur. I worry not only about my own cash flows, but also payrolls, business expenses and also how the world will return to normalcy in 6 months, a year, maybe more? I keep wondering how this pandemic will change the way we do business, how it will affect cross border business travel and many others.
And maybe for the first time, I truly understand how the sole proprietors out there and the marginally paid front line workers who live month by month are feeling. That sense less of helpless-ness and uncertainty that looms. Just last week, I overheard a young chap on the bus sitting behind me talking:
I was supposed to have gotten that restaurant job... They were reviewing my salary but after the circuit-breaker announcement on Friday afternoon, they came back and told me they not hiring anymore. My wife also just lost her job last month, so I just need to find something to do for this month, maybe food delivery or something...
The cash crunch is real for many. It's also creating a lot of tension for people. After I alighted the bus, I could hear another random person on the street arguing with someone over the phone. Fortunately the band aid here is that the government is giving discretionary payouts for low income families. I personally don't think it will be enough but I also believe that they are trying their best.
This one month of circuit-breaking will be a big financial set back for many people and businesses, even with increased food delivery measures for F&B operators. It'll also be a game changer for the world in terms of how individuals will manage themselves and businesses will interact with each other.
To be continued.
"Cruise liners are basically floating hotels. I think quite a number of them will be bankrupt soon."
Creativity and innovation are priced on the assumption that there is healthy underlying demand from the end user.
In 2014-15, liftboats became increasingly popular with many boat builders and offshore oil diggers. Apparently, digging for petroleum requires you to send more than a couple of boats out to sea - rigs, tugging barges, work and accommodation barges. The liftboat combines a few of these functionalities, allowing you to just send one vessel out, thereby saving costs. Some of the larger offshore companies had ordered these vessels, paying for as much as $600 million.
As the resources in shallow waters depleted, companies started to send their vessels further out to sea. And to make sure that it remained commercial to drill for oil, they had to dig deeper and longer, requiring the use of more sophisticated rigs such as drill-ships, some of which cost as much as $1 billion to build. So you can understand that when prices of oil tumbled below $50, everyone across the value chain - from builders, charterers to explorers - were scared sh*tless.
If you end up with a $1 billion piece of metal and oil prices hovering at around $40-50 a barrel - would you stay put and lose money or drill and lose money? Can you re-purpose a drill-ship for a different consumer market? A number of these once glorified companies actually went out of business or got acquired by other operators. It's not so different in today's circumstances.
With most of automotive manufacturing out of commission, car manufacturers such as Ford and GM had started to re-purpose their plants to build respirators / ventilators. Air travel has also basically come to a standstill because no one is traveling - for business or for leisure. But when it comes to the last mile delivery - food, groceries and basic supplies - airlines can quite possibly convert their fleet to transport supplies and cargo. Although tourist arrivals have taken a hit, hotels can be used to ease some of the capacity constraints faced by hospitals.
But a cruise-liner is basically a floating hotel. You can try re-purpose the vessels to transport cargo but it'll take too much work. We already have plenty of dry bulk vessels for that. In addition, a lot of these cruise companies based in the US don't seem to be part of Trump's stimulus package as they hire a lot of foreign workers and aren't technically incorporated in the US.
Some industries are better positioned that others to pivot their resources. The current situation is really a test of a company's ability to effectively re-purpose itself, essentially - to innovate or die.